New Delhi: The efforts of the government to revive the Department of Posts (DoP) seems to be bearing fruits as its deficit is likely to come down by over 16 percent to Rs 5,309.6 crore in 2011-12, the Economic Survey 2011-12 said on Thursday.

"In the current year 2011-12 (Budget Estimates), the gross receipts were budgeted at Rs 7,517.7 crore and with gross and net working expenses estimated at Rs 13,522.4 croreand Rs 12,827.3 crore respectively, with the deficit estimated at Rs 5,309.6 crore," the survey said.

The gross receipts of the DoP in 2010-11 were placed at Rs 6,962.3 crore whereas the gross and net working expenses were Rs 13,793.7 crore and Rs 13,307.9 crore respectively.

The resultant deficit for 2010-11 stood at Rs 6,345.6 crore, the survey said.

It added that the postal sector needs to keep pace with changing times as many of its services have become redundant with growth in technology and takeover by other players.

"Quick decisions and actions to stay abreast of the times including switching over to new activities and downsizing could release a lot of resources from this sector for use elsewhere," the survey said.

The government has approved a total Plan outlay of Rs 1,877.2 crore for the modernisation of its IT infrastructure to increase the efficiency of the department.

"The project is intended for computerisation of all the non-computerised post offices, mail offices, administrative and other offices, establishment of IT infrastructure and development of required software applications... The project is expected to be rolled out by the year 2013," the survey said.

DoP has the largest postal network in the world with 1,54,866 post offices across India as of March 2011. Of these, 1,39,040 post offices are in rural areas, while the remaining are in urban areas.

Aimed at transforming the infrastructure, the government had launched Project Arrow in 2008 for upgrading key postal operations such as mail delivery, remittance, and banking services.

India Post now offers a single window facility for banking, money remittances and other financial products.

The DoP is also responsible for disbursing wages under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) through 96,895 post offices.

The postal network is also being used by other government agencies to collect data like the rural consumer price index, the survey said.